PSEG, Exelon cancel capital projects at Salem nuke after legislation stalls
- Public Service Enterprise Group and Exelon Corp. have axed multiple capital projects at their jointly-owned Salem nuclear plant after the New Jersey legislature failed to pass a bill to support the state's nuclear generation.
- The bill would have supported PSEG's nuclear plants but the legislation was shelved in the Senate. The subsidies would have added about $350 million annually over 10 years, to the plants' revenue
- The spending would have included reliability and efficiency projects, according to the Associated Press. A similar decision may also be in the works at PSEG's Hope Creek plant.
New Jersey gets about 40% of its electricity from nuclear generation, but owners of the state's plants now say they will not make further investments beyond requirements from the Nuclear Regulatory Commission and other regulations.
The decision means PSEG will stop working to make the plants more efficient and reliable. NJ.com frames it as a "threat" from generation owners of "dirtier air, higher bills," if subsidies are not provided.
In a Form 8-K filed with the U.S. Securities and Exchange Commission, PSEG said that "funding of these projects may be restored when and if legislation is enacted in New Jersey that sufficiently values the attributes of nuclear generation and Salem benefits from such legislation."
The bill included both efficiency and solar initiatives, along with hundreds of millions in support for nuclear generation the companies say is needed to make up for lost revenues in the energy market.
According to the New Jersey Observer, the state Senate halted the bill by setting aside a vote on the bill. However, work continues on the measure. Senate President Steve Sweeney told the site "we’re going to continue to press forward ... we’re adjusting things and look forward to getting it passed.”
Last year, PSEG CEO Ralph Izzo told state lawmakers that cheap natural gas would force the Salem and Hope Creek plants into the red within two years — which could raise power prices and carbon emissions. New Jersey is not alone in its dilemma. Several other states have passed laws to support nuclear plants facing similar issues, including New York, Connecticut and Illinois.
- U.S. News & World Report PSEG Canceling Nuclear Plant Spending Due to Stalled Bailout
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